SEATTLE, Nov. 08, 2023 (GLOBE NEWSWIRE) -- Sana Biotechnology, Inc. (NASDAQ: SANA), a company focused on changing the possible for patients through engineered cells, today reported financial results and business highlights for the third quarter 2023.
“We continue to execute on our plans to develop our hypoimmune technology, with the potential to deliver data from four different clinical settings in 2023 and 2024,” said Steve Harr, Sana’s President and Chief Executive Officer. “We have increased confidence that this platform can prevent immune recognition of allogeneic cells, unlocking the potential for important medicines in blood cancers, B-cell-mediated autoimmune diseases, and type 1 diabetes, and we look forward to sharing data later this year and next. With our recent strategic repositioning, we expect 2024 operating cash burn to be below $200 million, enabling multiple clinical data readouts with our current balance sheet and a cash runway into 2025.”
Recent Corporate Highlights
Human proof of concept data in multiple clinical settings – including oncology, autoimmune diseases, and type 1 diabetes – expected in 2023 and 2024
Third Quarter 2023 Financial Results
GAAP Results
Non-GAAP Measures
A discussion of non-GAAP measures, including a reconciliation of GAAP and non-GAAP measures, is presented below under “Non-GAAP Financial Measures.”
About Sana
Sana Biotechnology, Inc. is focused on creating and delivering engineered cells as medicines for patients. We share a vision of repairing and controlling genes, replacing missing or damaged cells, and making our therapies broadly available to patients. We are a passionate group of people working together to create an enduring company that changes how the world treats disease. Sana has operations in Seattle, Cambridge, South San Francisco, and Rochester.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements about Sana Biotechnology, Inc. (the “Company,” “we,” “us,” or “our”) within the meaning of the federal securities laws, including those related to the company’s vision, progress, and business plans; expectations for its development programs, product candidates and technology platforms, including its preclinical, clinical and regulatory development plans and timing expectations, including the expected timing of IND filings and clinical trials for the Company’s product candidates and indications for which such INDs will be filed; expectations regarding the timing, substance, significance, and impact of data from clinical trials of the Company’s product candidates and an IST utilizing HIP-modified primary islet cells in patients with type 1 diabetes patients; expectations regarding the Company’s participation at ASH; expectations regarding the Company’s 2024 operating cash burn and cash runway, including the impact of the Company’s cash position on its ability to obtain data readouts from the Company’s clinical trials; potential indications for the Company’s product candidates; the potential of the IST to serve as clinical proof-of-platform for the Company’s hypoimmune-modified CAR T cell candidates; expectations with respect to the potential therapeutic benefits and impact of its development programs and platforms, including the potential ability of the hypoimmune platform to overcome immunologic rejection of allogeneic cells and the impact thereof, and the potential ability to replace missing islet cells without immunosuppression by evading allogeneic and autoimmune responses; and the impact of data from the IST on the development of SC451. All statements other than statements of historical facts contained in this press release, including, among others, statements regarding the Company’s strategy, expectations, cash runway and future financial condition, future operations, and prospects, are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “aim,” “anticipate,” “assume,” “believe,” “contemplate,” “continue,” “could,” “design,” “due,” “estimate,” “expect,” “goal,” “intend,” “may,” “objective,” “plan,” “positioned,” “potential,” “predict,” “seek,” “should,” “target,” “will,” “would” and other similar expressions that are predictions of or indicate future events and future trends, or the negative of these terms or other comparable terminology. The Company has based these forward-looking statements largely on its current expectations, estimates, forecasts and projections about future events and financial trends that it believes may affect its financial condition, results of operations, business strategy and financial needs. In light of the significant uncertainties in these forward-looking statements, you should not rely upon forward-looking statements as predictions of future events. These statements are subject to risks and uncertainties that could cause the actual results to vary materially, including, among others, the risks inherent in drug development such as those associated with the initiation, cost, timing, progress and results of the Company’s current and future research and development programs, preclinical and clinical trials, as well as economic, market, and social disruptions. For a detailed discussion of the risk factors that could affect the Company’s actual results, please refer to the risk factors identified in the Company’s Securities and Exchange Commission (SEC) reports, including but not limited to its Quarterly Report on Form 10-Q dated November 8, 2023. Except as required by law, the Company undertakes no obligation to update publicly any forward-looking statements for any reason.
Investor Relations & Media:
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Sana Biotechnology, Inc.
Unaudited Selected Consolidated Balance Sheet Data
September 30, 2023 | December 31, 2022 | |||||||
(in thousands) | ||||||||
Cash, cash equivalents, and marketable securities | $ | 268,570 | $ | 434,014 | ||||
Total assets | 631,440 | 822,720 | ||||||
Contingent consideration | 103,156 | 150,379 | ||||||
Success payment liabilities | 12,414 | 21,007 | ||||||
Total liabilities | 265,588 | 323,405 | ||||||
Total stockholders' equity | 365,852 | 499,315 | ||||||
Sana Biotechnology, Inc.
Unaudited Consolidated Statements of Operations
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
(in thousands, except per share data) | ||||||||||||||||
Operating expenses: | ||||||||||||||||
Research and development | $ | 65,613 | $ | 76,735 | $ | 205,823 | $ | 221,964 | ||||||||
Research and development related success payments and contingent consideration | (82,615 | ) | (6,062 | ) | (55,816 | ) | (79,428 | ) | ||||||||
General and administrative | 19,183 | 15,514 | 52,515 | 48,240 | ||||||||||||
Total operating expenses | 2,181 | 86,187 | 202,522 | 190,776 | ||||||||||||
Loss from operations | (2,181 | ) | (86,187 | ) | (202,522 | ) | (190,776 | ) | ||||||||
Interest income, net | 2,862 | 1,173 | 7,212 | 2,149 | ||||||||||||
Other income (expense), net | 303 | (106 | ) | 172 | (406 | ) | ||||||||||
Net income (loss) | $ | 984 | $ | (85,120 | ) | $ | (195,138 | ) | $ | (189,033 | ) | |||||
Net income (loss) per common share – basic | $ | 0.00 | $ | (0.45 | ) | $ | (1.01 | ) | $ | (1.01 | ) | |||||
Weighted-average number of common shares – basic | 196,978 | 189,303 | 193,605 | 187,645 | ||||||||||||
Net income (loss) per share – diluted | $ | 0.00 | $ | (0.45 | ) | $ | (1.01 | ) | $ | (1.01 | ) | |||||
Weighted-average shares outstanding – diluted | 200,473 | 189,303 | 193,605 | 187,645 | ||||||||||||
Sana Biotechnology, Inc.
Changes in the Estimated Fair Value of Success Payments and Contingent Consideration
Success Payment Liability(1) | Contingent Consideration(2) | Total Success Payment Liability and Contingent Consideration | ||||||||||
(in thousands) | ||||||||||||
Liability balance as of December 31, 2022 | $ | 21,007 | $ | 150,379 | $ | 171,386 | ||||||
Changes in fair value – expense (gain) | (5,340 | ) | 5,460 | 120 | ||||||||
Liability balance as of March 31, 2023 | 15,667 | 155,839 | 171,506 | |||||||||
Changes in fair value – expense | 20,784 | 5,895 | 26,679 | |||||||||
Liability balance as of June 30, 2023 | 36,451 | 161,734 | 198,185 | |||||||||
Changes in fair value – gain | (24,037 | ) | (58,578 | ) | (82,615 | ) | ||||||
Liability balance as of September 30, 2023 | $ | 12,414 | $ | 103,156 | $ | 115,570 | ||||||
Total change in fair value for the nine months ended September 30, 2023 | $ | (8,593 | ) | $ | (47,223 | ) | $ | (55,816 | ) |
(1) Cobalt Biomedicine, Inc. (Cobalt) and the Presidents of Harvard College (Harvard) are entitled to success payments pursuant to the terms and conditions of their respective agreements. The success payments are recorded at fair value and remeasured at each reporting period with changes in the estimated fair value recorded in research and development related success payments and contingent consideration on the statement of operations.
(2) Cobalt is entitled to contingent consideration upon the achievement of certain milestones pursuant to the terms and conditions of the agreement. Contingent consideration is recorded at fair value and remeasured at each reporting period with changes in the estimated fair value recorded in research and development related success payments and contingent consideration on the statement of operations.
Non-GAAP Financial Measures
To supplement the financial results presented in accordance with generally accepted accounting principles in the United States (GAAP), Sana uses certain non-GAAP financial measures to evaluate its business. Sana’s management believes that these non-GAAP financial measures are helpful in understanding Sana’s financial performance and potential future results, as well as providing comparability to peer companies and period over period. In particular, Sana’s management utilizes non-GAAP operating cash burn, non-GAAP research and development expense and non-GAAP net loss and net loss per share. Sana believes the presentation of these non-GAAP measures provides management and investors greater visibility into the company’s actual ongoing costs to operate its business, including actual research and development costs unaffected by non-cash valuation changes and certain one-time expenses for acquiring technology, as well as facilitating a more meaningful comparison of period-to-period activity. Sana excludes these items because they are highly variable from period to period and, in respect of the non-cash expenses, provides investors with insight into the actual cash investment in the development of its therapeutic programs and platform technologies.
These are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read in conjunction with Sana’s financial statements prepared in accordance with GAAP. These non-GAAP measures differ from GAAP measures with the same captions, may be different from non-GAAP financial measures with the same or similar captions that are used by other companies, and do not reflect a comprehensive system of accounting. Sana’s management uses these supplemental non-GAAP financial measures internally to understand, manage, and evaluate Sana’s business and make operating decisions. In addition, Sana’s management believes that the presentation of these non-GAAP financial measures is useful to investors because they enhance the ability of investors to compare Sana’s results from period to period and allows for greater transparency with respect to key financial metrics Sana uses in making operating decisions. The following are reconciliations of GAAP to non-GAAP financial measures:
Sana Biotechnology, Inc.
Unaudited Reconciliation of Change in Cash, Cash Equivalents, and Marketable Securities to
Non-GAAP Operating Cash Burn
Nine Months Ended September 30, | ||||||||
2023 | 2022 | |||||||
(in thousands) | ||||||||
Beginning cash, cash equivalents, and marketable securities | $ | 434,014 | $ | 746,877 | ||||
Ending cash, cash equivalents, and marketable securities | 268,570 | 511,573 | ||||||
Change in cash, cash equivalents, and marketable securities | (165,444 | ) | (235,304 | ) | ||||
Cash paid to purchase property and equipment | 5,986 | 16,274 | ||||||
Change in cash, cash equivalents, and marketable securities, excluding capital expenditures | (159,458 | ) | (219,030 | ) | ||||
Adjustments: | ||||||||
Net proceeds from issuance of common stock(1) | (27,009 | ) | (724 | ) | ||||
Cash paid for restructuring(2) | 1,881 | - | ||||||
Cash received in connection with the Coronavirus Aid, Relief, and Economic Security Act | (7,063 | ) | - | |||||
Cash paid in connection with the early termination of the Fremont lease | 4,423 | - | ||||||
Operating cash burn - Non-GAAP | $ | (187,226 | ) | $ | (219,754 | ) |
(1) Net proceeds of $27.0 million were received in connection with at market equity offerings in the nine months ended September 30, 2023.
(2) The non-GAAP adjustment of $1.9 million for the nine months ended September 30, 2023 consisted of cash payments related to the portfolio prioritization and corporate restructuring in the fourth quarter of 2022.
Sana Biotechnology, Inc.
Unaudited Reconciliation of GAAP to Non-GAAP General and Administrative Expense
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
(in thousands) | ||||||||||||||||
General and administrative – GAAP | $ | 19,183 | $ | 15,514 | $ | 52,515 | $ | 48,240 | ||||||||
Adjustments: | ||||||||||||||||
Loss on termination of lease associated with the Fremont facility(1) | (2,668 | ) | - | (2,668 | ) | - | ||||||||||
Write-off of construction in progress costs incurred in connection with the Fremont facility | - | - | - | (4,474 | ) | |||||||||||
General and administrative - Non-GAAP | $ | 16,515 | $ | 15,514 | $ | 49,847 | $ | 43,766 |
(1) For the three and nine months ended September 30, 2023, the loss of $2.7 million included $4.4 million in fees incurred, offset by a gain of $1.7 million recorded in connection with the derecognition of the right-of use asset and lease liability.
Sana Biotechnology, Inc.
Unaudited Reconciliation of GAAP to Non-GAAP Net Loss and Net Loss Per Share
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2023 | 2022 | 2023 | 2022 | |||||||||||||
(in thousands, except per share data) | ||||||||||||||||
Net income (loss) – GAAP | $ | 984 | $ | (85,120 | ) | $ | (195,138 | ) | $ | (189,033 | ) | |||||
Adjustments: | ||||||||||||||||
Change in the estimated fair value of the success payment liabilities(1) | (24,037 | ) | 2,193 | (8,593 | ) | (66,815 | ) | |||||||||
Change in the estimated fair value of contingent consideration(2) | (58,578 | ) | (8,255 | ) | (47,223 | ) | (12,613 | ) | ||||||||
Loss on termination of lease associated with the Fremont facility(3) | 2,668 | - | 2,668 | - | ||||||||||||
Write-off of construction in progress costs incurred in connection with the Fremont facility | - | - | - | 4,474 | ||||||||||||
Net loss – Non-GAAP | $ | (78,963 | ) | $ | (91,182 | ) | $ | (248,286 | ) | $ | (263,987 | ) | ||||
Net income (loss) per share – GAAP | $ | - | $ | (0.45 | ) | $ | (1.01 | ) | $ | (1.01 | ) | |||||
Adjustments: | ||||||||||||||||
Change in the estimated fair value of the success payment liabilities(1) | (0.12 | ) | 0.01 | (0.04 | ) | (0.36 | ) | |||||||||
Change in the estimated fair value of contingent consideration(2) | (0.30 | ) | (0.04 | ) | (0.24 | ) | (0.07 | ) | ||||||||
Loss on termination of lease associated with the Fremont facility(3) | 0.01 | - | 0.01 | - | ||||||||||||
Write-off of construction in progress costs incurred in connection with the Fremont facility | - | - | - | 0.02 | ||||||||||||
Net loss per share – Non-GAAP | $ | (0.41 | ) | $ | (0.48 | ) | $ | (1.28 | ) | $ | (1.42 | ) | ||||
Weighted-average shares outstanding – basic | 196,978 | 189,303 | 193,605 | 187,645 |
(1) For the three and nine months ended September 30, 2023, the gains related to the Cobalt success payment liability were $22.0 million and $8.3 million, respectively, compared to an expense of $2.4 million and a gain of $56.5 million, respectively, for the same periods in 2022. For the three and nine months ended September 30, 2023, the gains related to the Harvard success payment liability were $2.0 million and $0.3 million, respectively, compared to gains of $0.2 million and 10.3 million, respectively, for the same periods in 2022.
(2) The contingent consideration is in connection with the acquisition of Cobalt.
(3) For the three and nine months ended September 30, 2023, the loss of $2.7 million included $4.4 million in fees incurred, offset by a gain of $1.7 million recorded in connection with the derecognition of the right-of use asset and lease liability.
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Daily Change: | 0.03 0.94 |
Daily Volume: | 367,685 |
Market Cap: | US$597.330M |
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